What Lies Ahead

• By Michael Porto, PE
• Feb 01, 2002

Issues related to climate change and visibility rank as high priorities on the environmental management agenda for 2002. This article forecasts key regulatory issues including global climate change, nitrogen oxides (NO_x) budget developments, regional haze regulations in Class I areas and their industry impacts.

In March 2001, the Bush administration announced that it found the Kyoto Protocol fatally flawed with respect to American interests and consequently, the United States would no longer participate in the implementation negotiations. Proposed in 1997, the Kyoto Protocol is the international protocol to reduce greenhouse gas emissions. Key aspects of the Protocol include emissions targets, timetables for industrialized nations and market-based measure for meeting those targets. Reaction both domestically and internationally was swift and forceful. Even members of the president's political party expressed opposition to the decision to withdraw from the negotiations.

More recently, members of the U.S. Congress have introduced, or plan to introduce, a variety of bills addressing climate change. These bills include proposals to regulate emissions of carbon dioxide (a key greenhouse gas) from utilities and from cars and trucks, as well as proposals offering incentives for voluntary emission reductions. At press time, the Bush administration continues to communicate that its climate change policy is in development.

On the international front, Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change reconvened in November 2001 in Marrakesh, Morocco, to hold its seventh meeting - COP 7. The participants agreed on a number of rules necessary to implement the Kyoto Protocol. Key decisions included the following:

• Allowing emissions credits generated under the Clean Development Mechanism (CDM), Joint Implementation and trades among Annex I (developed) countries to be treated equally;
• Creating the Removal Unit to represent credits generated in Annex I countries via sinks;
• Establishing guidelines for banking unused emissions credits;
• Allowing non-Annex I countries to unilaterally undertake a CDM project and market the resulting emissions credits;
• Giving Russia an increase in the ceiling for forest management credits; and
• Requiring Annex I countries to report on efforts to protect biodiversity in the context of sink activities.

With the concessions made to Russia and other nations during COP-7, the Kyoto Protocol will likely meet the minimum criteria for implementation, which consists in ratification by nations representing at least 55 percent of greenhouse gas emissions from Annex I countries. Many multi-national companies are concerned about the prospect of having to comply with the Kyoto Protocol in some countries and with some other type of program in the United States. However, the development of a uniform plan seems unlikely.

Several recent court decisions may impact the implementation schedules under U.S. Environmental Protection Agency's (EPA) Federal NO_x Budget Program and the NO_x state implementation plan (SIP) Call. These decisions involve EPA's growth factors for electric generating units (EGUs) and EPA's definition of sources included in the EGU category.

In a May 15, 2001, ruling on EPA's Federal NO_x Budget Program, codified at 40 Code of Federal Regulations (CFR) 97, the U.S. Court of Appeals for the District of Columbia remanded the growth factors for EGUs and vacated and remanded the section of the rule that categorized cogeneration units as EGUs¹. On August 24, 2001, the court ordered that the Section 126 rule is remanded for cogenerators but vacated only for cogenerators classified as EGUs. The court effectively extended the compliance date for EGUs².

Upon review of EPA's NO_x SIP Call, the court remanded EPA's growth factors for EGUs and remanded EPA's classification of EGUs and non-EGUs³. Sources subject to the NO_x SIP Call have an initial compliance date of May 31, 2004. To address the court rulings on the Federal NO_x Budget Program and NO_x SIP Call, EPA has put a number of documents into the docket for these two rules as published in a July 27, 2001, Notice of Data Availability.

Recent developments in the Federal NO_x Budget program have several implications for industry in 2002. First, EGUs subject to the program have a new initial compliance date of May 1, 2003, which provides time to develop a compliance strategy and determine whether additional controls are necessary. Second, EPA's review of growth factors for EGUs and categorization of sources as EGUs and non-EGUs may bring about changes in the allocations of allowances for subject sources. Therefore, facilities may wait to finalize control strategies until EPA makes a definitive response to the court's remand; however, the NO_x SIP Call compliance date of May 31, 2004, has not been postponed. Finally, for facilities in states affected by the Ozone Transport Commission (OTC) NO_x Budget program, the subject sources and allowances have been defined in the individual SIPs, and the initial compliance date of May 1, 2003, has not been postponed.

Regulatory developments related to regional haze include implementation of the Federal Land Managers' Air Quality Related Values Work Group (FLAG) Phase I recommendations and EPA's expected recommendation of CALPUFF as the preferred model for long-range dispersion modeling.

The FLAG Phase I report set new visibility requirements and adjusted air dispersion modeling values, presenting new challenges for facilities within 200 to 300 kilometers (km) of Class I areas. The most dramatic regulatory changes issued in Phase I lie in the new visual range value. While the analysis is unchanged, with a five percent degradation allowed for a single facility or a total 10 percent degradation for all facilities, the revised background visual range results in a much more stringent analysis. Prior estimates of visual range were based on the 90^th percentile of the cleanest measured day. The revised FLAG document instead uses estimates of natural conditions derived from the 1990 National Acid Precipitation Assessment Program (NAPAP) studies. The revised visual range is two to five times more stringent than the older values.

Phase I also moves the relative humidity f(RH) cutoff function from 95 percent in the draft to 98 percent in the final report. Because of the asymptotic (characterized by a straight line that is always approaching but never meeting a curve) nature of the f(RH) curve as humidity approaches 100 percent, the change to a 98 percent cutoff results in a yet more stringent analysis.

Phase II of the FLAG report will address more complex issues, requiring additional data to fill information gaps identified in Phase I. Potential Phase II developments include recommending methods for establishing critical loads of pollutants, recommending a policy on re-designation of Class II federal lands to Class I, and refining procedures for cumulative air quality related valves (AQRV) impacts analyses.

Long-range dispersion modeling plays a key role in conducting AQRV impact analyses required by the Federal Land Manager (FLM) for Class I areas. In April 2000, EPA proposed to revise the Guideline on Air Quality Models to recommend that CALPUFF be used in the future for long-range transport modeling. CALPUFF is a non-steady-state puff model that simulates continuous puffs of pollutants released into the air. After a one-year transition period beginning upon promulgation of the new models, use of CALPUFF will be required for most regulatory applications. The extensive hourly meteorological data, or met data, required for this approach makes a CALPUFF modeling analysis a demanding endeavor. The rigorous tasks of obtaining, preprocessing, quality assuring, and documenting the appropriate meteorological data may challenge new CALPUFF users.

The 2002 environmental regulatory climate may fluctuate, as other national priorities require the Bush administration's attention. However, EPA remains diligent in promulgating regulations and enforcing compliance; environmental groups continue to exert pressure on industry, and public citizens remain concerned about the risks associated with their industrial neighbors. Responding proactively to climate change and visibility-related regulatory developments will help ensure that facilities satisfy EPA requirements and fulfill their corporate environmental objectives, benefiting the triple bottom line of economic performance, social responsibility and environmental stewardship.

¹ Appalachian Power Co. v. United States Environmental Protection Agency, May 15, 2001.

² Appalachian Power Co., et al., v. United States Environmental Protection Agency, August 24, 2001.

³ Appalachian Power Company, et al., v. United States Environmental Protection Agency, June 8, 2001.

This article originally appeared in the 02/01/2002 issue of Environmental Protection.